Study: Foreign labor resources enhance local economy

2013-5-31

From：Macau Daily Times

A study investigating the impact of foreign workers in Macau, conducted by the Macau University of Science Technology (MUST) Research Center, has released findings that the increase of foreign workers does not cause “class solidification in Macau, where local residents lack upward mobility channels.”
The researchers argue that the introduction of foreign labor (non-resident workers) has lowered the salary level in the tourism industry – the fastest developing industry in Macau – but will nonetheless have an increasingly positive effect in the future, “driving tourism wages to the salary level of other industries”. The study states that “the introduction of foreign labor in the tourism industry and increased salaries will aid the economic development of other industries,” since “other industries surpassed by the tourism industry require more foreign labor to meet their business needs.”
The study describes how the  expansion of the gambling industry has led to a rapid transformation of Macau and to a decline in its once vigorous textile industry. The study documents  the rapid decline in employee numbers within the manufacturing industry,  with statistics indicating that of the 1,900 industrial factories in Macau in 1992,  only 905 remained by 2010.
According to the MUST study, “the manufacturing industry in Macau is still in the process of looking for new economic opportunities and striving for survival” whilst the gaming industry increasingly dominates the region’s economic activity.  The strong economic performance of the gambling industry, aided by growing human resources needs and the increasing number of mainland visitors, has brought “lots of job opportunities, which has called for a huge number of high quality labor,” thus attracting many foreign  workers.
Data provided by the Statistics and Census Service indicates the existence of 27,736 foreign workers in December 2004. That number reached 39,411 in 2005and grew to 64,736 in 2006, an increase of 63.9 percent in one year. With the opening of Wynn Casino in 2006 and the Sands Casino and Venetian Casino in 2007, demand for labor has rocketed.
The number of foreign workers during the years since show uneven trends in foreign employment figures:  85,207 in 2007, 92,161 in 2008, before dropping to 74,905 in 2009, a decline attributed to the influence of 2008 Financial Crisis, increasing to 75,813 in 2010. More recently, statistics indicate a sharp increase in foreign workers. Foreign labor figures reached 94,028 in 2011 and grew to 95,187 in the first quarter of 2012. Overall, during the period of the study, beginning in 1991, foreign employment figures have increased by 740 percent.
Statistics indicate that “the salary of foreign laborers is usually low” and that “foreign workers only undertake low-
paid jobs that local workers are not willing to do”. Figures provided indicate that non-residents working in the hotel industry earn 30 percent less than local employees. This could explain why “their contribution to Macau GDP is not as high as that of local employees. However, foreign laborers’ technological level is 0.005 percent higher than local employees, indicating there is no large gap between the two in regards to technological contributions to Macau”.
The MUST research concludes that “the tourism, gambling, construction and real estate industries will continue to grow as the major industries of Macau, with the financial advantages of this continuously improving along with overall economic development, but the decline of export processing will result in its transformation.” PB

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